A public spending watchdog yesterday expressed concern after revealing that a massive increase in the number of motorists and motorcyclists not paying road tax cost taxpayers £217m in the past year.

According to the Department of Transport's Roadside Survey in June 2006, Vehicle Excise Duty (VED) evasion is now running at 5% - up from 3.6% (£147m) in 2005.

This is twice the 2.5% target set for the Driver and Vehicle Licensing Agency (DVLA) to achieve by the end of this year.

The figure effectively means that one in every 20 vehicles is now unlicensed, including 37% of all motorbikes.

Sir John Bourn, head of the National Audit Office, warned that confidence in the DVLA's enforcement regime risked being seriously undermined by the rising levels of non- payment by bikers.

The DoT surveyed 1.3 million vehicles in 256 sites across the UK.

No breakdown of figures was available for Scotland.

However, a DVLA spokeswoman said the number of unlicensed vehicles in eight police areas north of the border rose from 117,100 in 2004-05 to 146,000 in 2005-06 an increase of almost 25%.

The number of unlicensed motorcycles rose from 18,100 in 2004-05 to 55,200 in 2005-06 - an increase of 204%.

The spokeswoman could give no explanation for the massive increases other than to say that vigorous Vehicle Excise Duty campaigns were ongoing across the country.

Mr Bourn said: "I was concerned last year that the significantly higher rates of VED evasion by motorcyclists might undermine confidence in the DVLA's enforcement regime.

"My concern is even stronger this year, given the sharp jump in the evasion by motorcyclists, and by motorists more generally.

"It must be brought home to persistent non-payers of VED, whether motorcyclists or car drivers, that they will sooner or later be subject to enforcement action."

An investigation has been launched into the reasons for the increase, including the possibility it has been partly sparked by motorists seeking to avoid paying congestion charges and the increased use of number plate recognition cameras.

The watchdog also pointed out that more than 60% of people who failed to pay fines for not registering vehicles were not pursued through the courts or using debt collectors and "large numbers of hardened evaders" were not chased after their first offences.

It called for action to tackle an "underclass" of unlicensed vehicles used in crime - noting that a target for doing so had been dropped - and added that a technical loophole, which allowed some owners to escape paying one month's tax when they renewed, must be closed.

Tory MP Edward Leigh, who chairs the Commons Public Accounts Committee, said a failure to prosecute enough non-payers had contributed to the problem.

"More and more motorists and motorcyclists are refusing to pay road tax - and getting away with it," he said.

"The truth is that, if you refuse to pay, you stand a good chance of escaping further action: more than 60% of those who don't pay penalties for failing to relicense their vehicles or declaring them off-road are not being brought to court or being chased by debt collectors.

"A belief that punishment is unlikely is doubtless at the root of much evasion."

Mr Leigh added: "There is evidence as well that some road users are resorting to using false number plates in order to escape congestion charges.

"Whatever the reason, evasion on this scale is highly damaging to the rule of law.

"Those who refuse to pay must be left in no doubt that they will feel the weight of the law."